The first two quarters of 2012 showed a rise in profits due to growing sales in emerging markets for major brands such as LVMH, PPR and Luxottica. The top market is China, where luxury goods makers are gaining profits on sales of high-end handbags, fine jewellery and fragrances. Paris-based LVMH, said its sales went up by 26%, with 29% of their revenue coming from Asia, outside of Japan, the group’s largest market. Italy’s Luxottica, the largest eyewear maker in the world, said its first-half profits jumped 20.6% to EUR195.5 million: sales rose by just 1% in Europe, but were up by 35% in emerging markets.
Luxury brands aren’t the only ones who benefit from emerging markets; high street brands, such as Zara, H&M, Topshop and Next, are involved globally as well. Due to globalisation, people study, work and travel abroad. It can be a nostalgic buy or love of a brand, but customers are now more willing to make online purchases from overseas sites, and the business prospects of this trend are very promising.
Some countries do not see much success in online sales due to credit card security issues or because locals find it more convenient to shop in a store than buy online. Generally speaking, though, the rate of growth in online marketing is nearly double that of normal retail stores. The number of UK online shoppers is expected to reach 31.8m by 2013, and online sales in Europe are expected to grow to 190m online shoppers by 2014. 44% of retailers are selling from the UK to overseas locations while a further 14% intend to start doing so.
GSI Commerce International has commissioned a survey of over 2,000 UK adults and their online fashion buying habits. According to the report, almost half of the surveyed consumers prefer shopping for clothes and accessories online. Almost 64% of those surveyed visit fashion retailers’ websites to research items they like before deciding to buy them on the high street. 56% of consumers like online fashion outlets that allow them to filter searches by size and colour. Half of those surveyed said they liked being able to rotate and zoom in on products, while the same number also found hover boxes that offer additional product information useful. Customer reviews on items were considered to be important by 44% of the consumers surveyed. On the contrary, videos and pictures of celebrities wearing products (5%), being able to share content (3%) and audio descriptions of items (2 %) offer little incentives for consumers to purchase online.
For international brands it is important to keep the same image throughout the global market place. Translating their websites into different languages for the regions they are targeting for export is important for fashion brands so they can reach a large number of customers. People are more likely to search on Google (except China and Hong Kong where Baidu and Yahoo are preferred, respectively) in their native language, so online shops translated into different languages outperform those that are only presented in English. An example of a centralised portal translated into different languages is Zara. The company manages its global flagship stores to keep the same brand image and simply translates it into different languages keeping consistency across all regions.